Climate Change & the Ethical Obligations of Business (Eric Orts, Wharton School, University of Pennsylvania)

“Every business … has a climate imperative to be part of the solution.  [Climate change] is such an important problem, and business is such a central component of the problem that many businesses really have to make this a central condition on their profit-making activities. Especially for … the carbon majors. … The carbon majors have to radically change. … You can imagine a world in which the carbon majors … would meet together and then lobby governments and other businesss, and take responsibility for this to change.”

Investors are expecting [companies] to   return to profits to shareholders. …  If you have a company that’s making a radical switch, [and] their share prices are going to radically decrease, some of those companies are going to come under pressure from shareholders … So what you need then is also for investors to be changing [and] for the laws to allow companies to make this kind of shift.”

“Other companies can[also] be part of changing the market. … A large company [might say] ‘we’re going to switch entirely to renewable energy sources.’ … There will be a tipping point at some point at some stage where behavior will start to switch, and it becomes normal to be a climate friendly place.”

Eric Orts teaches corporate governance, environmental law and policy, environmental management, professional ethics, securities regulation, and theories of the firm at the University of Pennsylvania’s Wharton Business School.